August 17, 1998

Due to a high number of advance orders for Apple's new iMac, many of the little computers were gone within a few hours after their debut Saturday.
The iMac is the first real addition to Apple's consumer lineup in more than a year. Apple is betting that as many as 15 million loyal Macintosh owners, many of whom have displayed a real reluctance to invest in Apple products in recent years, will purchase the iMac.
Stores began offering discounts for pre-ordered iMac computers several weeks ago -- partly to spur sales on the machines and partly to test product demand by Apple users. As a result, a large percentage of the new computers were spoken for before they ever left the factory.
CompUSA in Kearny Mesa reported demand has been high locally, as well. Out of approximately 76 units received by the store, 72 were sold over the weekend. All but nine of these computers had been ordered in advance.
The San Diego Fry's Electronics would not comment on local sales figures, and corporate offices for that company did not return calls.
The iMac features a 233-MHz 750 PowerPC processor, 4 GB of hard disk space, 32 MB of memory and a CD-ROM drive. The system also comes with built-in networking and modem hardware, a CD-ROM drive and universal serial bus (USB) support for its keyboard and mouse. With USB, the iMac can recognize compatible devices intended for both Macintosh and PC systems.
Mysteriously, however, the iMac ships without a floppy drive, which makes it unattractive to more than a few consumers. At press time, Apple did not offer a USB floppy drive on its iMac peripherals page.
A spokesperson at CompUSA said that some customers were buying an external floppy to compensate, but the drive and the required USB adapter could cost as much as $300.
Prices For Some Intel Processors On The Upswing
A quick look through local computer publications confirms it: Prices for RAM and processors are indeed on the rise.
Due to production slow-downs and plant closures, inventory for many types of computer memory modules and processors has begun to dwindle, meaning a steady demand for these products will inevitably drive prices skyward.
In fact, anyone attempting to purchase Intel processors in the past few weeks probably already has noticed the change. As Intel moves newer, faster Pentium II processors into the market, prices for older models have been on the rise as more and more retailers run out.
Chips affected by the changes include Pentium II 233-MHz, 266-MHz and 300-MHz processors, which have been replaced by much faster 350-MHz, 400-MHz and 450-MHz chips, as well as the new, economically priced Celeron.
The price changes for Pentium II processors, which have been paralleled by adjustments in the worldwide memory market, are likely to stem the free fall in prices for low-costs PCs. Unfortunately, the changes could mean softer profit margins for retailers, who could see sales taper off as prices creep upward.
These same retailers have watched helplessly as market forces and silicon surpluses have driven PC prices into the ground over the past 18 months.
Interestingly, while retailers were selling this same group of processors at a loss only a few months ago are now able to sell the chips at a tidy profit. Prices for 300 MHz Pentium II, which recently dipped as low $250, have jumped by as much as $100 in past weeks. The same is true for other discontinued models still widely used.
Locally, only a handful of stores still have 233-MHz Pentium II chips, which currently are selling for about $200. In fact, because demand for the processors remains relatively high, retailers around the United States are reporting shortages on the older Pentium IIs.
The same is true for Pentium MMX processors, which Intel has stopped manufacturing altogether.